Ghost Policy Workers' Comp in California: Who Actually Qualifies?

Direct answer: A "ghost policy" is a minimal workers' comp policy for a contractor with no employees, purchased specifically to satisfy a general contractor's or client's requirement for proof of workers' comp coverage — even though you're legally exempt and don't have to carry it. It's often cheaper and simpler than losing a job over paperwork.

Here's the situation ghost policies solve: you're a legitimate no-employee exemption holder, so you're not required to carry workers' comp. But the general contractor hiring you as a sub requires every sub on the job to show proof of workers' comp — no exceptions, no exemption certificates accepted — because they don't want the liability exposure if you're hurt on their site and can't show coverage.A ghost policy is a minimum-premium workers' comp policy written specifically for this scenario.

It typically:Covers you at a minimal payroll basis (often the state minimum) since you have no actual employees to cover.Satisfies the paperwork requirement GCs and property managers ask for.May be evaluated differently from a policy written for an employer with payroll, since the exposure is much lower.It's worth noting: a ghost policy isn't a workaround for the exemption rules — it's a legitimate, separately purchased policy on top of (or instead of) your exemption filing. Many solo contractors in trades that regularly sub for GCs (electricians, plumbers, HVAC techs, drywall) carry one specifically because losing jobs over a missing COI costs more than the policy does.

Official verification and coverage context

California licensing and workers' compensation requirements can change. Review the current official CSLB and California DIR guidance for the facts that apply to the business, then discuss coverage terms with a licensed broker. Related resource: contractor coverage directory.